The Misfits: Addus HomeCare Corporation (ADUS)

The in-home caregiver has walked a narrow path to success.

Saint John the Evangelist, Titian, 1540s, oil on canvas (National Gallery of Art)

Is a company a good investment simply because its stock has gone up for a long time? I struggle with this question quite a bit. There are great companies in mediocre industries and decent businesses in great industries that generate spectacular wealth for their investors. There is also this unique group of companies that continue to generate good results for their investors, but you wonder how they have been able to do it.

Addus HomeCare Corporation (NASDAQ: ADUS) falls into that last bucket. It has generated spectacular long-term results for its investors, but the industry in which it operates, its financials, and the way management is compensated make you wonder how it managed to pull it off.

Companies aren’t successful for a decade and a half without having one good quality or two. So, let’s look at what has made Addus HomeCare a market-beating investment, why its path to success is a little harder to explain, and what it will take for this company to continue its success.

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